Got Price-Fixing? Big Dairy To Fork Over $52M In Rebates For Killing Cows

Dairy cows eat after being milked at Kelsay and Son dairy farm on July 20, 2012 near Whiteland, Indiana. Higher than normal temperatures caused milk production to drop on Midwest dairy farms, while the region also experienced its worst drought in more than five decades, causing concern among farmers about small crop yields and a shortage of feed for their livestock. (Photo credit: Scott Olson/Getty Images)

Over the past two weeks, word has begun to spread that Big Dairy is shelling out lawsuit dollars to American consumers of milk, yogurt, and other creamy products. But while 'free' money is often sweet news by itself, the story behind this relatively slim settlement has a distinctly more sour and, for milk cows, far deadlier flavor.

As NPR reported Friday, a class-action lawsuit against the dairy industry's largest umbrella group has resulted in a $52 million settlement that's available to select consumers of its products. Cooperatives Working Together (CWT), whose members contribute about 70% of all U.S. milk, responded to a suit by animal rights activists that alleged price-fixing with a no-fault settlement package of cash and store credit worth just shy of 0.15% of the industry's annual haul.

Dairy cows wait to be milked at the Rob-N-Cin farm led by father Robert Roden, wife Cindy and son Rick, as they tend to the roughly 400 head of cattle on September 29, 2010 in West Bend, Wisconsin. The dairy industry in Wisconsin is an integral cog in the state's economic wheel that brings in roughly 26 billion dollars annually and is more important to the state then citrus to Florida and potatoes to Idaho combined. (Photo credit: Darren Hauck/Getty Images)

The class-action suit was brought by lawyers with the animal rights group Compassion Over Killing, which, through the help of gallant general counsel Cheryl Leahy, "spends a lot of time trying to get the dairy industry to be nicer to cows," says NPR. Several years back, Leahy caught wind of an industry practice during (increasingly frequent) hard times for price-per-gallon of launching herd buyout programs, in which arms of the CWT or affiliated National Milk Producers Federation offered to buy out smaller farms' milk cows to process them en masse for meat.

And while the practice of cutting down livestock populations is an entirely legal and, on a smaller scale, quite regular and integral one for the industry, Leahy felt it still "[sounded] a lot like price-fixing." She told NPR, "It raised questions for us about antitrust laws. And the especially outrageous part to us was that this was all done by killing over 500,000 young cows."

So, rather than leak money in court 'til the cows come home addressing a long-troubled tradition, the industry group decided to settle. Jim Mulhern, President and Chief Executive Officer of the National Milk Producers Federation, said in a statement [PDF], “Our CWT leadership team, with support from the CWT membership, has worked diligently to put this legacy issue behind us. Settlement of this litigation is the most sensible and responsible course of action to maintain the current CWT Export Assistance program and allow us to focus on the future." He continued,

It is important to note that the court has found no antitrust violation and CWT makes no admission of wrongdoing in this settlement. The activity at issue in this litigation — the herd retirement program — has long since been terminated by CWT.

Unfortunately for some, rebates will only be available to claimants who purchased fresh milk products in 15 states after 2003, since which time milk production has indeed been climbing steadily. Between 2005 and 2015, annual production rose from around 177 billion pounds to 209 billion, while cash receipts from 2015 "marketings of milk" dropped nearly 28% from the previous year, according to the U.S. Department of Agriculture. As NPR previously pointed out, these numbers also reflect an industry that's seen the number of farms with milking cows drop from about 3.5 million to fewer than 58,000 in the past six decades.

Nevertheless, Big Dairy will be picking up the tab for eligible claimants who file by the end of January, i.e. in the next two days. So while there's still time for dairy fans to apply for at least some compensation, it couldn't hurt to shake a leg--a stampede of 3.5 million reportedly already have.

I'm a freelance writer covering tech, media, science, and culture. My background includes the areas of writing, editing, and education, and I received Bachelor and Master of Arts Degrees from the University of British Columbia and California State University, East Bay, respe...